Legg Mason’s Borromeo increases dollar exposure

Regina Borromeo 480
Fund manager Regina Borromeo

Legg Mason fund manager Regina Borromeo has upped her exposure to the dollar at the expense of emerging market currencies.

Borromeo, who co-manages the £61m Legg Mason Income Optimiser fund, increased exposure to the dollar from 2.5 per cent to 19 per cent over the past three months. 

Borromeo says: “The way for us to de-risk is to increase our US dollar holdings. It is a way for us to hedge against some of the price falls we have seen in China and emerging markets.

“We are positive on the US but its also a way of us to de-risk. We have been selling down some of our emerging market currency exposure – for instance we have covered our Turkish and South African exposure.”

Additionally, Borromeo has increased the fund’s duration to hold 30 year Mexican government bonds yielding over 7 per cent by switching out of short-dated bonds at 4 per cent yield. 

Legg Mason Income Optimiser’s cumulative performance to 29 July 2013

Fund -2.27% 0.23% 8.55%    
-2.16% 0.47% 6.68%    
-0.12% -0.24% 1.75%    
  45 / 74 36 / 68 30 / 68    
3 3 2    

Source: FE Analytics